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Is your supply chain in a death spiral?

OVERVIEW

With half of companies’ costs in the supply chain or cost of goods and services (COGS), reducing supply chain costs is a major focus. 3-4 percent: Yet companies are not realizing cost savings for competitive agility. They eke out three to four percent in category reductions year after year. But most never make a sustainable bottom line impact on COGS.

Leading companies are breaking this cycle with ZBSC (zero-based supply chain)—part of ZBx (zero-based mindset), a way to drive profitability that emphasizes the future over the past. ZBSC can help companies capture supply chain value in a rapidly changing world.

KEY FINDINGS

ZBSC requires a mindset shift across the organization:

HITTING A WALL. It is not that supply chain executives have turned a blind eye to systemic supply chain issues. Companies are doing cost optimization across the supply chain. But most are not getting sustainable results.

DYNAMIC, NOT DEAD END. By applying ZBSC, companies no longer push for the next percent of hoped-for savings. They embed a new way of working that constantly enables new ideas about where and how to capture value that can be funnelled back to growth.

NO STANDING STILL. Continuous renewal makes ZBSC different from traditional supply chain cost optimization. Whereas old methods rely on cost targets based on yesterday’s realities, ZBSC is a sustainable reset of a company’s cost baseline.

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